Morgan Stanely Turns It Around

Despite the tricky market environment during the second quarter,
Morgan Stanley
posted gains throughout its franchise.

Earnings for the quarter reached $1.4 billion, or 80 cents per share, representing a turnaround from the loss of $138 million, or $1.36 per share, reported in last year's corresponding period. Sales meanwhile grew 53% to $8 billion, from $5.2 billion.

Wall Street analysts, on average, anticipated earnings of only 46 cents per share on sales of $7.9 billion. The results for the quarter included a tax benefit of $345 million, or 20 cents per share.

Investors wasted no time in showing their appreciation for the numbers, as shares of
Morgan Stanley
rose 7.6%, or $1.91, to $27.13 in early-morning trading. Morgan's shares have struggled since April, when Wall Street was shaken up by the European sovereign debt crisis, though things have been turning around since July.

Morgan's report comes a day after fellow brokerage house
Goldman Sachs
reported a rare sales miss as both its top- and bottom-line significantly decreased, which it said was due to the difficult market environment. (See "Goldman Shows It's Mortal.")

Morgan Stanley's chief executive said markets were "challenging" during the second quarter. "We still have a great deal of work to do across our global franchise and anticipate that the difficult market environment may continue in the months ahead," said
James
Gorman
James Gorman
, Morgan's chief executive. "That said, we believe that regulatory reforms are a key step toward restoring trust in the industry and the markets." Last week the U.S. Senate voted in favor of Wall Street regulatory reform, setting up the legislation to be signed into law by President Obama.

Morgan's report comes on the same day large regional bank
Wells Fargo
and investment management firm
Blackrock
reported better-than-expected results.